Brazil · Delayed Price · Currency is BRL Suzano Earnings Call Transcripts
Fiscal Year 2026
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Q1 2026 saw strong operational performance, cost control, and robust hedging, with higher pulp and packaging EBITDA offsetting export price and FX headwinds. Management expects improved sales and pricing in Q2, maintains CapEx guidance, and continues to prioritize deleveraging and disciplined capital allocation.
Fiscal Year 2025
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Record pulp shipments and strong U.S. packaging growth drove robust Q4 2025 results, with improved cash flow, reduced leverage, and resilient margins despite price pressures. 2026 guidance points to stable costs, lower CAPEX, and continued focus on operational efficiency.
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Management is prioritizing competitiveness and value extraction from recent investments, with no major new projects planned. The company is navigating a challenging pulp market by focusing on cost reduction, innovation in fiber applications, and operational excellence, while advancing sustainability and preparing for future growth through select partnerships and digitalization.
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Cash cost fell 7% year-over-year, now below BRL 800/ton, with further improvements expected from operational efficiencies and the Eldorado wood deal. Leverage rose to 3.3x due to lower pulp prices, but net debt and free cash flow remain stable.
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Second quarter results met expectations with strong EBITDA and stable net debt. A wood swap deal with Eldorado is set to optimize costs and provide production flexibility, while a 3.5% production cut aims to maintain returns. Downward cash cost trends and positive outlooks for packaging and pulp segments were highlighted.
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A new JV with Kimberly-Clark will give Suzano control of a major tissue business across 14 countries, targeting $175 million in annual synergies and an IRR above 15%. The deal diversifies revenue, maintains investment grade, and focuses on operational efficiency, with no major M&A planned soon.
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Q1 2025 saw results in line with expectations, with normalized inventories, resilient free cash flow, and a focus on cost reduction and deleveraging. Packaging volumes and prices improved, while global trade tensions and tariffs increased uncertainty, especially in China.
Fiscal Year 2024
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Record sales and strong operational execution drove robust 2024 results, with EBITDA up 37% in pulp and net debt-to-EBITDA at 2.9x. Integration of U.S. assets and contract renegotiations set the stage for improved 2025 performance, while deleveraging and disciplined capital allocation remain priorities.
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Management reaffirmed a disciplined strategy focused on cost reduction, operational excellence, and targeted international growth, with no large M&A planned. Major projects like Cerrado and U.S. acquisitions are on track, while financial guidance was updated to reflect inflation and FX. Capital allocation remains value-driven, with a strong deleveraging path.
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Sales volumes and EBITDA rose on strong execution and FX, while leverage declined despite higher net debt. Ribas mill ramp-up and new asset integrations are ahead of plan, with focus on value extraction and further deleveraging.
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Q2 saw strong operational results, with EBITDA up 14% sequentially and strategic investments in Lenzing and Pactiv. The Cerrado Project was delivered on time, supporting future cost competitiveness, while share buybacks and disciplined capital allocation remain priorities.